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Healthcare Staffing Agencies Lose Contracts to Slow Follow-Up

Healthcare Staffing Agencies Lose Contracts to Slow Follow-Up

The agency labor market got smaller, not bigger. That changes what a two-day reply to a fill request actually costs you.

Co-Founder & CPO

Staffing agencies lose contracts when fill requests and clinician applications sit unanswered, because facilities move to the next vendor on the list. Temporary agency usage in nursing homes has fallen about 44% since the fourth quarter of 2022, per AHCA/NCAL.

The Agency Labor Pool Is Shrinking, Not Growing

Healthcare staffing agencies are competing for a smaller pool of work than they were three years ago, and that single fact reorders the priorities. Start with the number behind it. In its 2026 Long-Term Care Workforce Report, built on a survey of its member nursing homes, AHCA/NCAL reported that temporary staff agency usage has decreased by about 44 percent since the fourth quarter of 2022, while 62 percent of the nursing home operators surveyed said their overall workforce situation improved over the past year and 90 percent still described staff recruitment as difficult (AHCA/NCAL, 2026). Facilities are hiring better than they were, and they're buying less agency labor.

That combination is the whole competitive picture for your business right now. In 2022, a slow reply to a fill request was survivable, because the facility was desperate and you were one of very few options. In a market where agency spend has contracted by nearly half, the same slow reply is a decision to hand that request to whoever picks up first.

The recruiting half hasn't gotten easier, which is the useful asymmetry. Recruitment is still hard for almost every provider surveyed. So the work of finding a qualified CNA or LPN is as hard as ever, while the willingness to pay a vendor to do it has tightened. Agencies that win in that environment aren't the ones with the biggest bench. They're the ones a scheduler can reach at 6 a.m. on a Sunday when a call-out leaves a shift uncovered.

None of this is an argument that demand vanished. Nursing facilities added 40,700 jobs in 2025, an average of about 3,400 workers a month, and the sector's workforce still sits 1.7 percent below where it was before the pandemic, according to the same AHCA/NCAL report. The demand is real. It's just being allocated more carefully, by buyers who now have alternatives.

How Deep Facility Dependence on Healthcare Staffing Runs

Buying less doesn't mean buying none, and the structural picture is stronger than the spending trend suggests. A 2025 longitudinal analysis published in Healthcare examined CMS Payroll Based Journal data and found that in 2018, 23% of nursing homes used agency nursing staff, accounting for 3% of direct care hours. By 2022, nearly half of nursing homes used agency staff, accounting for 11% of direct care hours (Healthcare, 2025). Facility penetration roughly doubled in four years and the hours share nearly quadrupled.

The same study tracked agency share of hours by discipline from 2021 to 2023:

Discipline

Agency share of hours, 2021

Agency share of hours, 2023

Registered nurses

6.2%

8.9%

Licensed practical nurses

8.9%

11.6%

Certified nursing assistants

7.4%

9.3%

Read the peer-reviewed penetration data against the association's spending data and a specific conclusion falls out. Agency staffing became a permanent fixture of how facilities operate, and then the budget for it shrank. That means the volume you're losing is mostly not going back in-house wholesale. It's being consolidated among fewer vendors per facility. Consolidation is decided on reliability and responsiveness, because those are the two things a scheduler can actually observe about you before signing anything.

Which puts an unglamorous activity at the center of your growth plan: answering. Not pitching, not rate negotiation, not a better bench. Answering, consistently, at the hour the request arrives. We've argued the general version of this for this industry in why speed to lead matters in healthcare staffing, and the market contraction has raised the stakes on it.

What Happens to a Fill Request That Waits Until Monday

An uncovered shift isn't an inconvenience for your client. It's a census constraint. AHCA/NCAL's 2024 Access to Care Report found that 46 percent of nursing homes were limiting new admissions, 57 percent had a waiting list for new residents, and 20 percent had closed a unit, wing, or floor because of labor shortages (AHCA/NCAL, 2024). Facilities with waiting lists and admission limits are not short on demand. They're short on staffed capacity.

Now add what that staffed capacity looks like day to day. In December 2025, KFF reported that nursing facility residents receive an average of 3.85 hours of nursing care per day, including 0.68 hours of RN care, 0.87 hours of LPN care, and 2.3 hours of nurse aide care (KFF, 2025).

Put those two findings side by side and the value of a fast reply stops being a sales talking point. Facilities are already capping admissions over staffing, and daily care runs on a margin measured in fractions of an hour per resident. An unanswered fill request is therefore a census decision, made on the facility's behalf by nobody in particular. The scheduler who can't reach you doesn't file a complaint. They call the next vendor, and then they keep calling that vendor first.

There's a second-order effect worth naming. A facility that gets burned on coverage twice stops sending the request to three vendors and starts sending it to the one that has never left them stranded. That is how a preferred-vendor relationship actually forms, and it forms in minutes on ordinary Fridays rather than in quarterly business reviews. Once it forms, the agency at the top of that list sees the request before anyone else does, which compounds. The agency in third place is bidding on the shifts the first two declined.

Picture a Friday at 4:40 p.m. Two CNAs call out for the weekend at a 90-bed skilled nursing facility, and the scheduler sends the same request to three agencies. Yours has a voicemail box. The second answers Monday at 9. The third confirms two qualified clinicians within eleven minutes, texts their credentials, and asks whether the facility wants the same two back for the following weekend. Nothing about your bench mattered in that sequence. The only variable was who was reachable at 4:40 on a Friday.

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Your Clinicians Are on the Same Clock

The other half of slow follow-up costs you supply rather than demand. Turnover in the settings you staff stays high even as it improves: the Hospital & Healthcare Compensation Service's 2025-2026 Nursing Home Salary & Benefits Report, covering 917 nursing homes and more than 111,600 employees, found CNA turnover declined from 44.16% to 42.34%, with sign-on bonus usage dropping from 65.44% to 55.61% (HCS, via AHCA, 2025).

The demand side of the labor pool is enormous. PHI's Direct Care Workers in the United States: Key Facts 2025 projects an estimated 9.7 million total job openings in direct care between 2024 and 2034, a 13 percent increase, with median annual earnings just under $26,000 (PHI, 2025). Those openings count turnover and people leaving the field, not 9.7 million brand-new jobs.

A CNA weighing that many openings, at those wages, is not waiting three days for a callback from a recruiter. There's no reliable public number on how fast healthcare candidates drop out of a hiring process, and the figures that circulate on that question trace back to vendor marketing rather than research, so we won't quote one. The structural evidence is enough: high turnover plus abundant openings plus low wages describes a workforce with real optionality and no reason to wait. We covered the downstream version of this in why caregiver candidates ghost interviews.

Consider what the arithmetic looks like from a clinician's side of the table. Someone certified as a CNA can work for your agency, for the facility directly, for a competing agency, or for a home care company across town. When the pay on offer across those options is broadly similar, and at a median under $26,000 a year there isn't much room for it not to be, the process difference becomes the deciding factor. The agency that answers an application at 9:15 p.m. and books an interview for Tuesday morning wins a candidate that the agency calling on Thursday never had a real chance at.

Where the delay usually hides:

  • An application lands at 9 p.m. and gets its first human read the next afternoon.

  • Screening questions about license status, availability, and travel radius happen on a call that takes three attempts to schedule.

  • Credential collection runs by email, so the candidate stalls waiting for a reply about which documents count.

  • A qualified clinician sits in the queue behind unqualified ones nobody has sorted yet, which is the problem we broke down in optimizing the applicant funnel.

  • Interview scheduling bounces for days between a recruiter who works days and a candidate who works nights, and every round trip is another chance for a competing offer to land first.

Can One Team Answer Facilities and Clinicians at Once?

Not on business hours alone, and that's usually the binding constraint long before talent supply is. Requests and applications arrive across too many channels, at hours nobody is scheduled for, and both sides go cold at the same speed.

Alita's voice AI answers the scheduler's phone call at 4:40 on a Friday, captures the shift details, and routes the request to your on-call account manager with everything already written down. Alita's smart intake agents handle the same conversation in web chat and by SMS, including on social channels like Facebook Messenger and Instagram, and link agents pick up candidates arriving from an Indeed post or a paid ad without making them start over on a form. On the supply side, Alita's hiring agents screen clinicians for license, availability, and radius the moment they apply, then book the interview.

The channel spread is the part that defeats scheduling your way out of this. A scheduler calls. A director of nursing texts the account manager directly. A travel LPN applies from an Indeed post at midnight. A CNA messages your Facebook page because that's where she found you. Adding an after-hours shift covers one of those and misses the rest, which is why the answer has to sit across every channel at once rather than behind one phone line.

What stays human is everything that requires judgment: deciding whether a clinician is right for a difficult unit, holding the rate conversation, managing the account relationship, and making the placement call. What gets automated is the first response, which is currently a voicemail greeting on one side and an unread application on the other.

The Objection Your Clients Will Raise

Address this one directly, because a sophisticated client will bring it up. The 2025 longitudinal analysis in the peer-reviewed journal Healthcare, working from CMS Payroll Based Journal data, found that nursing homes in the top quartile of agency use had roughly 7.7 percentage points higher RN turnover and 1.9 points higher CNA turnover among their permanent staff than lower-use facilities, with no significant association for LPNs. Heavy agency reliance and permanent-staff churn travel together.

Two things are true about that finding. It is real, and it is a correlation rather than a demonstrated cause: the facilities buying the most agency hours are usually the ones already short-staffed and already churning, which makes heavy agency use at least partly a symptom of the problem it gets blamed for. Either way the operational answer is the same, and it's an argument about continuity rather than about vendors. A facility cycling through unfamiliar faces every weekend pays for it in the morale of the people who stay. Which is exactly why responsiveness and continuity are the same product: an agency that can fill a request in minutes can send the same two clinicians back next weekend, while an agency that answers Monday sends whoever is left. Speed isn't the opposite of continuity. Slowness is what forces the scramble that destroys it.

Continuity has a mechanical requirement, though, and it's worth being precise about it. Sending the same clinicians back means knowing which clinicians worked which unit, who the charge nurse asked for by name, and who is available next weekend, at the moment the request comes in rather than after a search through text threads. If your repeat-clinician rate is lower than you'd like, check which constraint is actually binding: whether those clinicians were unavailable, or whether nobody could reconstruct the history fast enough to make them the offer.

Numbers that show whether your follow-up is actually fast

  • Minutes from fill request received to a human-confirmed response, split by whether it arrived inside business hours.

  • Request-to-fill rate per client facility, tracked monthly, because a client's declining rate predicts the lost contract before the contract is lost.

  • Repeat-clinician rate, meaning how often the same person goes back to the same unit for the same client, which is the metric a director of nursing feels most directly.

  • Minutes from application received to first two-way contact with the clinician.

  • Applications that closed unreachable. This one is usually larger than a recruiter's memory of it.

The Alita Hub holds every one of those conversations in a single record across phone, chat, SMS, and social, so an account manager reviewing a slipping client can see the actual response times instead of reconstructing them from memory. For agencies placing clinicians into skilled nursing and senior living, that visibility is the point of what Alita builds for healthcare staffing agencies. In a market where agency spend has shrunk by nearly half, the contracts you keep are the ones where you answered first, every time, without needing a person awake to do it.

Why are healthcare staffing agencies losing contracts?

Why are healthcare staffing agencies losing contracts?

Largely because buyers now have alternatives and less budget for agency labor. AHCA/NCAL reported temporary staff agency usage down about 44 percent since the fourth quarter of 2022, so a fill request that waits until Monday goes to whichever vendor answered first.

Largely because buyers now have alternatives and less budget for agency labor. AHCA/NCAL reported temporary staff agency usage down about 44 percent since the fourth quarter of 2022, so a fill request that waits until Monday goes to whichever vendor answered first.

How much do nursing homes actually rely on agency staff?

How much do nursing homes actually rely on agency staff?

More than the spending trend suggests. A 2025 longitudinal analysis in Healthcare found 23% of nursing homes used agency nursing staff in 2018, accounting for 3% of direct care hours, rising to nearly half of nursing homes and 11% of hours by 2022.

More than the spending trend suggests. A 2025 longitudinal analysis in Healthcare found 23% of nursing homes used agency nursing staff in 2018, accounting for 3% of direct care hours, rising to nearly half of nursing homes and 11% of hours by 2022.

Does using agency staff increase a facility's own turnover?

Does using agency staff increase a facility's own turnover?

The same 2025 Healthcare analysis found nursing homes in the top quartile of agency use had about 7.7 percentage points higher RN turnover and 1.9 points higher CNA turnover among permanent staff. Continuity of assignment, meaning the same clinicians returning, is the practical counterweight.

The same 2025 Healthcare analysis found nursing homes in the top quartile of agency use had about 7.7 percentage points higher RN turnover and 1.9 points higher CNA turnover among permanent staff. Continuity of assignment, meaning the same clinicians returning, is the practical counterweight.

Summary

The agency labor market got smaller, and that raised the price of a slow reply. AHCA/NCAL reports temporary agency usage down about 44 percent since the fourth quarter of 2022 while 90 percent of operators still find recruitment difficult, so the requests that remain get consolidated among the vendors who prove reachable. Facilities have little slack to absorb your delay, with 46 percent limiting new admissions and daily care running at 3.85 nursing hours per resident. Clinicians have optionality too, given CNA turnover above 42 percent and 9.7 million projected direct care openings through 2034. Alita answers fill requests and applications the moment they arrive by phone, chat, SMS, and social, screens for the details your team would ask about, and hands your account managers and recruiters a complete picture while the other vendors are still checking voicemail.



https://alitahealth.ai/authors/landon

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